the construction sector in greater manchester: overview of skills issues
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1 the construction sector in greater manchester: overview of skills issues
2 1. INTRODUCTION The note summarises the findings of primary and secondary research in respect of the skills and training priorities for Greater Manchester s construction sector. The intention is for the information and data in each sector summary to be used by employers and skills and training providers to inform the development of new strategies and approaches to skills and training. 2. INSIGHTS AND RECOMMENDATIONS The recession has led to a reduction in Greater Manchester s construction workforce and a corresponding rise in the numbers of businesses reporting skills gaps and hard-to-fill vacancies; The sector s ability to respond strategically to these developments is hampered by the small size of firms and the lack of training budgets; Nevertheless, Greater Manchester s construction sector has developed strong links to specialist external training providers and the majority of companies are happy with the service training providers offer; Training, particularly around current skills gaps in biomass (efficient heating systems), joinery and drylining and in growth areas such as modern methods of construction (MMC), related IT, customer service and innovation techniques, will help the sector to realise its potential; Alongside developing new courses, action may also be needed to broaden the profile of learners on these courses and to increase the numbers of Level 3+ starts; The profile of publicly funded training starts within the sector is predominantly at Level 2 and overwhelmingly male; The sector has historically used informal recruitment methods such as recommendations from existing staff. As growth returns and the sector s workforce ages the scope to do this will reduce; and Businesses believe there is a need for improved information, advice and guidance for young people who are considering a career in the sector. 3. PROFILE OF THE CONSTRUCTION SECTOR IN Greater Manchester There are 6,500 construction businesses within Greater Manchester; These businesses employ almost 54,000 people; This employment is spread fairly evenly across Greater Manchester; Employment is concentrated in activities including demolition and site preparation and trades used in the end stages of a building project (e.g. electrician, plumbing, and carpeting); The even spread of construction employment is not replicated in terms of businesses. Localities such as Wigan and Oldham are home to significant numbers of construction businesses; Businesses within the sector are considerably more likely than companies in other parts of the Greater Manchester economy to be small in terms of numbers of employees and to be independently owned; and Growth forecasts for the construction sector in general predict a slow recovery from the cutbacks of recent years, with employment growing by 1.1% a year, but GVA growing more quickly at 2.6% per year. However, a more optimistic picture of construction sector growth is painted by the Greater Manchester Chamber of Commerce pipeline analysis, which anticipates 11.07bn of new construction project starts in Greater Manchester by 2017.
3 Figure 1: Location of Construction employees in Greater Manchester Source: Business Register and Employment Survey, 2012 The sector is characterised by full-time employment, with 88% of employees working full time, compared to 72% across Greater Manchester as a whole. N % % OF LOCAL ECONOMY Bolton % 10.7% Bury % 9.6% Manchester % 4.3% Oldham % 12.4% Rochdale % 10.4% Salford % 9.3% Stockport % 9.8% Tameside % 10.9% Trafford % 8.1% Wigan % 13.1% Greater Manchester 6, % 9.2% NW* 25, % UK* 27, % Source: IDBR, 2012; *publically available IDBR dataset 1 Greater Manchester Construction Sector, Pipeline Analysis, Greater Manchester Chamber of Commerce, November 2012
4 4. DEMANDS FOR SKILLS AND TRAINING FROM THE SECTOR A fifth of Greater Manchester construction companies report having a skills gap; Hard-to-fill vacancies within the construction industry rose from 2% in 2009 to 40% in 2012; this compares to 23% in the economy as a whole; Greater Manchester construction businesses identify local skills gaps in relation to: o Mechanics o Biomass engineers o Joiners o Dry-lining Some 95% of Greater Manchester construction employers can identify training that is mandatory or essential for their staff; But 80-85% of firms do not have a dedicated training budget; Some 68% of employers carry out in-house training compared with an all sector figure of 85%; and A total of 75% of survey respondents said they felt that training providers gave enough support to help their company grow. Greater Manchester s construction sector has developed strong links to specialist external training providers and the majority of companies are happy with the service training providers offer. Mandatory qualifications that drove training needs included: the CSCS card (Construction Skills Certificate Scheme); the ECS card for the electro-technical industry; and gas industry related licences such as the ACS. Other skills valued by the sector included knowledge of health and safety regulations and the ability to drive. In terms of additional demands of training providers, companies in our survey suggested that providers should: Organise programs better and provide support during the training period; Make sure candidates have the right skills and the level of expertise advertised; and Ensure a forum is available where employers needs can be matched with training provision, and that provision is responsive to employers training requirements. Further issues which may affect the sector s demand for training and skills in future include: The loss of key skills through retirement or employees opting to find employment elsewhere. By 2020, 19% of the current workforce will have reached retirement, making recruitment essential; A drop in government spending on construction has reduced the sector s annual recruitment requirement by a third. 5. SUPPLY OF SKILLS AND TRAINING TO THE SECTOR In a given year there are approximately 5, year old Greater Manchester residents studying construction related subjects; To this figure can be added a further 8,300 Greater Manchester residents aged 19+ who were studying construction related subjects; this figure includes 1,000 apprenticeships; Apprenticeships are mainly started by younger people under 25 years (87% in 2012/13 - with 56% between 16 and 18 years, and 31% 19 to 24 years). This has been a fairly consistent trend in the sector since 2008/09. The majority of starts were for level 1 (30%) and level 2 (50%), with level 3 only accounting for 12%; Numbers of construction training starts by under 19s have been falling recent years whilst starts by adult learners (19+) have increased; Some 76% of the construction companies surveyed said that they felt engaged with training and learning providers. This compares to 79% across all nine sectors included in the survey; and Major providers of construction training by numbers of starts within Greater Manchester include: o Manchester College o Salford City College o Oldham College o CITD Construction skills o Economic Solutions Some 75%+ of publicly funded provision to the sector is at Level 2 or below (exact figures vary by type of course and funding body) and more than 90% of these starts are undertaken by males. Students from Wigan and Salford account for higher percentages of these starts. 2 CITB-ConstructionSkills (Jan 2013) Construction Skills Network: Blueprint for the construction
5 Table 2 - Gender and Level of study by Greater Manchester residents of SFA funded construction courses, 2012/13 CONSTRUCTION ALL SECTORS Male 96% 47% Female 4% 53% Entry 3% 10% Level 1 & Entry 30% 20% Level 2 50% 20% Level 3 11% 21% Level 4, 5 and higher 1% 0% Other 5% 29% Source: SFA, 2012/13 Research has found that within the construction sector formal recruitment procedures are often replaced by recruiting by word-of-mouth or receiving referrals from family or friends. This approach seems to work quite well: 85% of the construction companies surveyed felt that the current supply and quantity of recruits met their business needs. The satisfaction rate across all-sectors was 77%. However, other comments show that work ethic, attitudes and general employability skills are lacking in many young recruits. Some young people are misinformed on pay, working hours and money expectations. A total of 88% of construction firms said that apprenticeships were suitable to their industry (84% was the all-sectors rate). 6. OPPORTUNITIES AND CHALLENGES By 2022 it is expected that the sector will employ over 80,000 people (+26,000 on its current employment total) and contribute 4bn to the Greater Manchester economy; However, the key drivers for recruitment and training within the sector will relate to the existing sector workforce retiring, moving on or changing career; The link between learning and apprenticeship appears to be relatively weak. There are large numbers of learners under the age of 19 on construction related subjects who are not pursuing apprenticeships; Some employers comment that young people lack work-readiness, employability and motivation; however, apprenticeships are seen as a worthwhile response to this issue. Other factors that will affect the sector s future skills needs are felt to include: o modern methods of construction - It is predicted that the move to off-site working will increase the need for skills such as mechanical handling and computer aided design (CAD) o ICT sector managers will be required to integrate design, construction, logistics and manufacturing sides of projects; and o customer service - there is an assumption in the industry that clients are mainly large stakeholders (e.g. government) while in reality they vary dramatically in size. Legally binding carbon reduction targets will create new job and skills gaps within the sector - it is forecast that up to 65,000 jobs could be created nationally by retrofit and associated advice services;
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